In the first week of May, Energy Secretary Chris Wright told a House committee that his agency was not withholding or freezing any funding, and had not canceled any projects to date. It was a statement that Democrats in the committee pushed back on, even going so far as to accuse Wright of “outright lying” to Congress during the hearing.
When Wright heads to the Senate this week to testify before the appropriations committee about the president’s 2026 budget request, it may be even harder to make those same claims.
In a statement last week, DOE said that its review of Biden-era commitments had unearthed “concerning” findings, and that the department had begun “requesting additional information needed to evaluate” some 179 individual awards, totaling over $15 billion. “If it is determined that a project does not meet standards, DOE may modify the project or, in its discretion, may terminate the project based on the outcome of DOE’s evaluation,” the statement said.
According to former DOE officials, the first of those anticipated cancellations may be announced as soon as this week, starting with the long-targeted Loan Programs Office. The Trump administration plans to announce it is de-obligating seven conditional commitments — loans that were awarded but hadn’t yet reached final close — totaling more than $8 billion.
Most of the projects on that list, however, had already decided to step away from the federal funding of their own accord; in some cases, their reasons for backing away from plans for domestic manufacturing are connected specifically to the economic uncertainty caused by the chaos of the second Trump administration.
LPO’s process often involves issuing a conditional commitment for a project in order to signal to equity investors that there’s a reasonable prospect of repayment, former LPO director Jigar Shah explained in a statement on Friday. “Borrowers are required to meet rigorous conditions prior to close, and even then are required to meet rigorous conditions prior to DOE advancing funds,” he added.
But in the case of the conditional commitments that the agency is expected to cancel, the projects “weren’t even afforded the chance to meet those initial conditions, in part based on this administration’s posture and policies,” Shah said. “When we lose the trust of equity investors, our loan applicants have no choice but to move away from commercializing their technologies in America or cancel their projects outright.”
The projects already walking away from funding
In February, battery component manufacturer Aspen Aerogels said it had withdrawn from the negotiation process to finalize its $670 million loan, and told investors that instead of building a new plant in Georgia, it would be expanding production in China and Mexico. Battery maker Kore Power said it was rethinking its plan to build a greenfield factory in Arizona, for which the company had received a conditional commitment for a $850 million LPO loan. When asked about the last-minute decision, local officials cited federal funding uncertainty.
Then, in April, the International Recycling Group backed out of plans for a Pennsylvania plastic recycling plant that would have generated a new, cleaner product to be used in the steelmaking process. The company pointed to the delay in finalizing its promised $182.6 million deal with LPO, which it had been awarded in July 2024.
Those project cancelations followed reports from 2024, before the Trump administration took office, that Redwood Materials, another battery recycler, had decided to walk away from its promised DOE loan, sticking instead to private funding and citing its growing financial strength.
Meanwhile, Project Hestia, a massive virtual power plant project spearheaded by Sunnova Energy, won a $3 billion loan guarantee that’s also expected to be de-obligated in the coming days. That particular project has long been in Republican crosshairs, and in late 2023 Sunnova found itself at the center of a Congressional probe into its sales practices.
But Sunnova too appears to have walked away from its deal with LPO voluntarily: in its latest 10-K filing, the company stated that it does “not expect to use the [loan guarantee] for future securitizations in the foreseeable future.” Additionally, the statement added, “we currently expect to reduce the pace at which we seek additional guarantees of certain of our indebtedness from the DOE due to a shift in customer demand from solar loans to leases and PPAs.”
Importantly, for the purposes of the Trump administration’s intent to bring back taxpayer dollars spent during the Biden administration, Sunnova’s agreement with DOE was somewhat unique from the other projects on the list. As Shah explained on a recent episode of Open Circuit, the government didn’t directly loan the company money; instead, the DOE guarantee backs the bonds associated with the loans Sunnova provides to consumers to enable them to buy solar. In other words, LPO isn’t funding Sunnova’s corporate operations in the way it does for other projects, and in the case of a loan cancellation, the federal government isn’t actually recouping any funds.
Building without LPO
Two of the seven companies whose projects DOE plans to cancel are still apparently moving forward. New Jersey Clean Energy Corridor, a project to upgrade and expand transmission infrastructure in New Jersey, was slated to receive up to $715 million from LPO. And advanced fossil company Monolith Materials had been approved for a $1.04 billion loan to expand clean hydrogen and carbon black production in Nebraska.
Both of those projects appear to be moving forward — despite news of the potential hit list. Monolith didn’t immediately respond to Latitude Media’s request or comment, and Jersey Central Power and Light declined to comment.
The ultimate fate of the remaining projects backed by LPO remains murky. Under the Biden administration the office announced 53 deals, totaling more than $107 billion in project investment and spanning industries including battery production, critical minerals, and nuclear.
Loans that didn’t make it to final close before the Biden administration left office — including the seven conditional commitments slated for announcement this week — always had less security than those that had been finalized.
Updated DOE regulations eliminated a provision that previously allowed the Energy secretary to terminate conditional agreements for any reason and at any time. That change went through in 2023, and experts have told Latitude Media that filing to follow those regulations could open the agency up to lawsuits — though the potential for litigation certainly isn’t something the administration has shied away from in its dealings with DOE so far.
The finalized loans, worth a combined more than $60 billion, have both more certainty and more legal protection against cancelations. But as chaos continues inside DOE, and at LPO specifically, even finalized commitments may be hampered by the firing of project staff and slowdowns in disbursements.
